New proposals could see water being delivered by private companies on the basis of financial sustainability, not need
Glenda Daniels
South African public sector unions have been caught off guard by the government’s announcement to fast-track regulations to privatise water delivery.
Unions said this week they were still trying to work out the implications in terms of job losses and they would formulate a response as soon as they had consulted with their members.
If the delivery of water in the future does not generate enough profits, then the level of services will drop, especially to poor rural people, according to the South African Municipal Workers’ Union (Samwu).
Minister of Water Affairs and Forestry Ronnie Kasrils announced last week that new draft regulations will allow local authorities to appoint private companies to provide water services, and that public-private partnerships would be set up to provide water in the country’s rural areas – all aimed at improving service delivery. Kasrils invited comments from NGOs and unions.
The new regulations will undermine clause 19.2 of the Water Services Act, which says water must be delivered by local government and not the private sector. The regulations also undermine the spirit of the Act, which is firmly in favour of water as a public service and not a commodity.
Samwu says it is not sure how many jobs will be lost from local government through the privatisation of water (about 220E000 people are employed by local government), but it is sure that the quality of water will deteriorate and that poorer people, especially those in the rural areas, will not gain access to free water.
“We’ve only found out about the move in the past week. As a union we have to discuss an approach to the government’s plan to amend the Water Act to make room for the private sector. There is a feeling that this might be unconstitutional. If there isn’t profit services will drop, and the poorest will be affected,” says Samwu president Petrus Mashishi.
Kasrils told Parliament: “Public-private partnerships have given rise to much heated debate both here and abroad. Having inherited the Nelspruit and Dolphin Coast public/private contracts, I have spent a great deal of time studying this issue. I have had to set aside views from a former millennium and attempt to look objectively at the situation – given current reality. If we are to make headway against the enormous backlog of people without water, we must use the resources available to us – available in the private sector.”
This new twist in policy is driven by the need to “earn profitable returns on investments and must, in return, have guarantees of security and clarity about the rules of the game”. However, the government claims that it will regulate services in ways that ensure that the “public good does not become subservient to private gain, that the returns are reasonable and that the consumer’s interests are fully protected”.
Kasrils also said the government will encourage the cross-subsidisation of previously neglected and underprivileged areas. To this end, the expertise of the Development Bank of South Africa and international consultants is being solicited.
Samwu says that although the new regulations have not yet been subject to the normal process of public comment, apparently 30-year privatisation contracts have been suggested.
Meanwhile, research shows that lengthy private contracts have failed in many parts of the world. For example, last month Grenoble City Council in France fired the private water company and brought water back under the control of the municipality.
Samwu says that the regulations are problematic particularly in the context of rural areas, because it could mean that many rural citizens will never gain access to running water as poor people will have to pay high prices for water.
The Rural Development Services Network (RDSN) points out that between 40% to 60% of rural people do not have adequate supplies of drinking water and to this end the government has a political responsibility to ensure a sustainable approach to water access and delivery.
The NGO wants the government to “ensure the implementation of a national cross- subsidisation of 50 litres of free, clean water per person, per day”, says the RDSN’s Junaid Seedat.
He says South African water service delivery is in a serious crisis of sustainability and the present proposed regulation is setting the pace for the consolidation of private delivery that has thus far amounted to non-delivery of a basic supply of water to rural communities.
“We further call for an increase in the equitable share to local government to ensure that water delivery and access are in the control of the public sector. In order to ensure a productive and economically enabled rural society, we call on government to provide access to water for productive use,” says Seedat.